China's monetary easing to slow pace: Nomura

The pace of monetary easing from China's central bank will slow, with the country's equity market stabilizing due to rescue measures and the real economy showing signs of improvement, an Asian investment bank has predicted.

The pace of monetary easing from the People's Bank of China (PBOC) may be slower than previously, Nomura bank said on Wednesday.

The wording of the briefing following the Chinese central bank's monetary policy committee meeting is largely unchanged from the previous one.

"Therefore, we believe the PBOC will likely maintain its current monetary stance which is, in our view, biased toward easing," said Zhao Yang, chief China economist at Nomura.

After the latest quarterly meeting of its monetary policy committee, the PBOC on Tuesday announced that it will pursue a "prudent and balanced" monetary policy with more attention to striking a balance between tight and loose.

Nomura expected another 50 basis points (bps) cut in the requirement reserve ratio (RRR), the minimum level of reserves banks must hold, and 25 bps benchmark interest rate cut in the rest of the year, Zhao said in a latest research note.

The next move is likely to be a RRR cut in August, he predicted.

China's economy posted a better-than-expected growth of 7 percent in the second quarter of 2015, but was lower than the double-digit growth registered in past decades.

The PBOC moved to counter the economic slowdown, cutting benchmark interest rates four times since November, including a 25-bps interest rate cut in June and lowering banks' RRR across-the-board twice since February like the one-percentage-point (100 bps) cut in April.

China's stock market has showed early signs of recovery thanks to the government's rescue measures. The benchmark Shanghai Composite Index lost more than 30 percent in less than a month from its peak on June 12, prompting the government to intervene. Endi